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bne April 2019 Companies & Markets I 11
[original equipment manufacturers] OEMs are “shoring up
the slumping EU diesel market” and have been reluctant to embrace the electrification revolution. Instead, “Diesel engines have been the cornerstone of their expertise and allowed
them to have a competitive edge vis-à-vis US and Asian manufacturers.” Delays to new vehicle releases have also been linked to the change in the EU emissions test cycle.
“The suppression of EV sales is apparent in carmakers’ limited model choice and availability. Market monitoring shows that seven all-electric model launches were recently delayed in Europe. This has led to waiting times of between six and 12 months for most plug-in cars,” the report says. “Carmakers also launched fewer new battery electric and fuel cell (ZEV) models in 2018 than 2017. Just seven were added last year, whereas 20 new models will be added in 2019, 33 in 2020 and 45 in 2021.”
In addition to Tesla’s much reported production issues, T&E points to other delays such as the Audi all-electric E-tron, whose first deliveries were delayed to March 2019, and Daimler CEO Dieter Zetsche’s announcement that the Mercedes EQC will not meet demand in 2019 and probably not by 2020, plus the delayed rollout of the Jaguar I-Pace, the Honda Urban EV and the Kia e-Niro.
Regulatory drivers
According to T&E, regulation is driving EV sales in all major markets: “The main driver of EV sales has been clean car policies in the world's three largest car markets,” it says.
“EU carmakers currency don’t need to sell EVs, so they don’t make an effort,” says the report. “On the other hand ... model availability will change radically from 2019-2020 onwards. This is because EU carmakers need to sell an estimated 5-7% plug-in models to meet the 2021 CO2 standard.”
By 2030, CO2 standards in Europe will require more than a third of car sales to be electric, and to meet 2050 climate goals, all sales would have to go zero emission in the early 2030s. “This is also why governments are trying Incentivise fully zero emission models, like battery electric cars, more,” says T&E.
The report also identifies other positives in the European market, indicating good potential for sustainable long-term growth. Battery electric vehicles (BEVs) showed strong sales in 2018, and several launches of new BEV models are in the pipeline. Unlike the US, which is dependent on a single brand, Tesla, sales of EVs in the EU are much more diverse.
“While Europe might have lost the 2018 battle, the race is still on,” says the report.
A charged market
An issue examined by other industry observers is the availability of electric vehicle charging points. To date, the number of EV chargers has been much lower in Eastern European countries, holding back development of the market.
An earlier report from T&E, published in September 2018, finds that, “In western and northern Europe a basic minimum infrastructure is, or imminently will be, available to recharge the EVs ... In Southern, Central and Eastern Europe the deployment of rechargers has been much more limited.” The smaller EV markets are expected to lag behind frontrunners
by five to 10 years, despite plans in the draft European Commission budget for 2020-2027 to spend at least 60% of the EU’s cross-border infrastructure fund on schemes that help the fight against climate change.
While there were around 2,550 rapid charging sites installed on European main roads as of 2018, they are very unevenly distributed across the continent. Specifically, there are close to zero charging points per 60km of highway in the region from
“A breakdown by country shows a clear divide between the west and east of the European Union”
Hungary and Slovenia in the north to Greece in the south. “The lack of coverage in Hungary, Romania, Bulgaria and Greece is notable and needs to be addressed to enable EVs to be used EU-wide,” the report says.
"Fast charging along corridors and highways is essential for drivers to complete journeys beyond the range of their vehicle. It also acts as a psychological safety net enabling drivers to travel longer distances and further from their usual charging location.”
Still, there have been a series of investments into charging stations in the Central and Southeast Europe region. Slovakia- based GreenWay, for example, builds and manages EV charging infrastructure throughout CEE. The company plans to install a total of 145 fast charging stations in Slovakia
and Poland. As of October 2018, it had largest EV charging network in the CEE region, with 113 public charging stations in operation from Slovakia to Poland.
2018 EV sales (EU): strong market growth reaching 2% share
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